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London Allowance and pay

To all staff and students

I am writing to let you know about the latest developments on London Allowance and pay.

The School recognises the concerns of staff but regrets that the two days' strike action called for next week may be prejudicial to the interests of students. The future of the School depends on their goodwill and financial contribution. You will understand that in the meantime we must minimise the impact of the strike action on students. Arrangements are being made to adjust registration of students; they are being informed. We are in close touch with the Students' Union. Professor Judith Rees is coordinating help to academic departments which may be affected by the strike.

The new Director Howard Davies, who takes up appointment officially on 1 October, met the trade unions at an introductory meeting today. He heard the concerns about higher costs associated with living in London and the impact on staff turnover and morale. At that meeting Howard Davies apologised on behalf of the School for the impression created last year that the School minimised the importance of staff concerns about the London Allowance and the impact of an increase in the Allowance on individuals' circumstances.

As you know the School is firmly of the opinion that it cannot meet the unions' claim for a doubling of the London Allowance, which would cost £3.6m per year. A sum of this size would severely damage the School's finances and ability to make progress. No provision for this level of increase has been made in government funding of universities in London. The School has already made representations to government on this issue.

The latest position is as follows. There will be a meeting of employers at universities in London on 2 October. LSE will attend and put forward proposals to resolve this dispute. We hope that this meeting will lead to an agreement on a collective approach. Therefore it is not appropriate to consider a local resolution now. If the employers' meeting does not produce a solution, the School will seek, in a fresh approach with the unions, to achieve a local resolution including mechanisms for future review of London costs.

It is also relevant that the School has for some time pursued a local approach to tackling low pay. Our policy has been to focus on improvements in the pay and conditions of lower paid staff. While not directly addressing the cost of living in London, this has significantly reduced the numbers of staff in the lowest pay bands.

The nationally proposed Framework Agreement for modernisation of pay structures gives all staff, from 1 August this year, a 3.44 per cent increase in basic salary or £550 whichever is the greater, and also abolishes the two lowest scale points completely. We hope the trade union ballots will be completed in time for staff to receive this backdated pay award in their end of November salaries.

Adrian Hall
Secretary and Director of Administration
25 September 2003